Logan Mohtashami from HousingWire emphasizes that mortgage rates in 2024 will be influenced by macroeconomic variables such as economic growth, inflation, and unemployment. Contrary to whims of recession forecasts, the U.S. economy has shown resilience. Consequently, mortgage rates have remained elevated. The Federal Reserve’s policy on interest rates plays a pivotal role; the persistence of inflation pressures the Fed to maintain higher short-term rates. As of September, while the easing cycle commenced, tightening prevails as the Fed seeks to manage inflation rather than boost growth.
Flavian Nunes highlights the sensitivity of mortgage rates to Federal Reserve actions, noting their loose correlation with the yield of the 10-year Treasury. For the upcoming year, they anticipate a yield range of 3.4% to 4.50%. With the absence of recession indications, the yield likely won’t dip below 3.40%; however, should economic performance exceed expectations, the yield could surpass 4.5%. This shift echoes the ongoing tussle between inflation pressures and economic growth.
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